In a year’s time, we receive a lot of people with our Culinary & Wine Tours business (www.lizcaskey.com) that are very savvy wine drinkers. They come to Chile and Argentina to experience the wines in their place of origin, taste the local terroir, and inevitably, the desire to bring some of these drinkable memories (treasures?) home becomes a a big issue: Do you we ship it or pack it in our suitcase? How much we take back without raising eyebrows in customs? And if we want to buy a case, is distribution good? Many of the answers are surprising so my intention in this post is to help orient all of you traveling down to these latitudes that want to take wine back.
MONEY, MONEY, MONEY
The great irony of buying wine in country (in Chile) is that the prices are HIGHER than what you would pay for in the US. Yes, you read that correctly. HIGHER. It all comes down to taxes and demand. Chile is not a huge wine drinking country and as such, allocates most of its production abroad (around 90%). Beyond that, we have a huge VAT (sales) tax on everything here, 19%, from water to bread to batteries to wine. Wine also has an alcohol tax for wines included call ILA at another 16%. Grand total in taxes on a bottle of wine? 36%.
So why is this not the case if you are buying stateside? Wineries are able to export at what they call FOB (Freight on Board). FOB is the wholesale cost of wine without any taxes, tariffs, or third party mark-ups. Since the US has a free trade agreement with Chile, basically the cost structure breaks down to:
-FOB (cost of wine)
-Shipping
-Any third party margin (importers, distributors, wine shops)
-State sales taxes (ranging from 6-8.5%)
All of this however is still the same or LESS than that 36% we pay here.
I have to admit, when I was in California in July, I was blown away by how cheap Chilean wines were. At Trader Joe’s in Napa, I found Don Melchor 2005 for US$40 (US$85 at Concha y Toro winery in Chile). They also had Clos Apalta at US$65 in various wine shops whereas at the winery we visit frequently, I can get it at “discount” for US$115. Continuing my laundry list of how much cheaper Chilean wines are in the US, Costco buys around 70% of Montes winery’s Montes Alpha line which retails for US$13. Price at winery? Depending on the exchange rate, US$14-15. My favorite wines, red and white respectively, Almaviva and Sol de Sol Chardonnay, can be acquired online at Wine Exchange (www.winex.com) for US$75 for the blockbuster 2005 vintage (hand of winemaker extraordinaire Tod Mostero) and Sherry Lehman in New York for US$21 plus shipping. Price at winery (wholesale) here? US$120 and US$30, respectively. My Dad just called me yesterday, excited to have found this tiny boutique jewel, Neyén 2004 (sold out in Chile) at the State Store on Harrisburg Pike in my hometown Lancaster, PA. Go figure.
My advice is that if there is a special vintage or collector’s item (like Neyen’s limited edition Syrah or the impossible-to-procure Carmin from Concha y Toro), grab it. Or buy it in Chile to enjoy and drink while here. There is something magical about drinking wines in their place of origin with the local food. However if you are seriously stocking your cellar after a trip here, or want to acquire some good bottles, my suggestion is to find the distributor or importer and buy/ship the case.
That’s the real skinny on buying wine here. Even working in the industry, it seems counter intuitive to bring home Chilean wine from the US. (Yes, I do it. At least with Almaviva). Next part to cover how to get it back once you commit to buying it while traveling. There are some tried and proven tricks to make it stress free.
